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Selling Out - Muppets ,Hunting Elephants, and the loss of the Secret Sauce
What motivates top salespeople to sell?
It clearly is not
just the money. Perhaps we can learn from the open letter of recent resignation.
It is a sad thing to witness a successful salesperson
resigning due to the fact that they feel the working environment of their company has become
‘toxic and destructive’.
It is particularly so if it is out of concern for the interests
of clients continuing to be side lined in the way the firm operates and thinks
about making money.
The PR experts for Goldman Sachs must limit the damage to reputation in
the short term when such feelings are vented in public through an open letter in
a newspaper like the New York Times. March 14th 2012 leading to the letter going 'viral' on the web.
It is also clearly worrying for some of Goldman’s clients.
Yet that is what Greg Smith of Goldman Sachs chose to do.
Whether Goldman Sachs carry out the best practise of exit
interviews with their departing Salespeople I know not, but in one sense we
have what might have come out at such an interview through his open letter .
It reveals values that this Salesman has which
because he felt the firm no longer shared has led to his resignation.
It is obviously only his truth, his side of the story but it does give
us an insight to what a salesman at the top of the earning ladder believes is what
selling is about.
Over the course of his career with Goldman Sachs, Mr. Smith states he had the privilege of advising two of
the largest hedge funds on the planet, five of the largest asset managers in
the United States, and three of the most prominent sovereign wealth funds in
the Middle East and Asia. His clients have a total asset base of more than a
To state that you have lost pride and belief in the firm which
formerly‘revolved around teamwork,
integrity, a spirit of humility, and always doing right by our clients? The
culture was the secret sauce that made this place great and allowed us to earn
our clients’ trust for 143 years.’
To then continue to accuse the CEO and president to have ‘ lost
hold of the firm’s culture on their watch… a decline in the firm’s moral fibre
represents the single most serious threat to its long-run survival. ‘ has
probably meant he will be struck off their Christmas card list this year.
Of course both parties will move on and draw a line under
the sorry situation.
According to Mr Smith, the firm changed the way it thought
"Leadership used to be
about ideas, setting an example and doing the right thing. Today, if you make
enough money for the firm (and are not currently an axe murderer) you will be
promoted into a position of influence."
What are three quick ways to become a leader? Mr Smith goes on
"a) Execute on the
firm’s “axes,” which is Goldman-speak for persuading your clients to invest in
the stocks or other products that we are trying to get rid of because they are
not seen as having a lot of potential profit.
b) “Hunt Elephants.” In
English: get your clients — some of whom are sophisticated, and some of whom
aren’t — to trade whatever will bring the biggest profit to Goldman. Call me
old-fashioned, but I don’t like selling my clients a product that is wrong for
c) Find yourself sitting in a seat where your job is to
trade any illiquid, opaque product with a three-letter acronym."
“It makes me ill how callously people talk about ripping
their clients off. Over the last 12 months I have seen five different managing
directors refer to their own clients as “muppets,” sometimes over internal
Mr Smith doesn’t know of any illegal behaviour, but asks “..will people push the envelope and
pitch lucrative and complicated products to clients even if they are not the simplest
investments or the ones most directly aligned with the client’s goals? “
"Make the client the focal point of your business again.
Without clients you will not make money. In fact, you will not exist. Weed out
the morally bankrupt people, no matter how much money they make for the firm.
And get the culture right again, so people want to work here for the right
reasons. People who care only about making money will not sustain this firm —
or the trust of its clients — for very much longer. "
From this angry letter I guess we have learnt a little more about what has demotivated a top salesperson.